Road tax on electric cars in 2026: VED, the £50,000 supplement and pay-per-mile eVED from 2028

Electric cars now pay road tax in the UK. Since 1 April 2025, a new electric car pays £10 in its first year, then the standard rate of £200 a year, plus a £440 supplement for five years if its list price is over £50,000. From 1 April 2028, a new pay-per-mile charge, Electric Vehicle Excise Duty (eVED), adds 3p per mile for battery electric cars and 1.5p per mile for plug-in hybrids.

For a single driver this is a few hundred pounds a year. For a fleet, it becomes a new budget line that depends on mileage. This guide sets out each tax, who pays it in a lease, how eVED will be collected, what changes for vans, and how to forecast the cost car by car. At Voltaback, we see fleet managers start this forecast with the one figure they often lack: real mileage per vehicle.

Do electric cars pay road tax in 2026?

Yes. Vehicle Excise Duty (VED), commonly called road tax, has applied to electric cars since 1 April 2025. Until then, zero-emission cars sat in a nil-rate band. Today an electric car registered on or after 1 April 2017 pays the same standard rate as a petrol or diesel car.

Paying by 12 monthly Direct Debits costs £210 a year instead of £200. VED rates for cars and vans will be uprated by RPI from 1 April 2027, so the £200 figure will rise.

Sources: GOV.UK vehicle tax rate tables, cars registered 2001 to 2017, Budget 2026 overview of tax legislation and rates.

What an EV saves on the first-year rate

The first-year rate is where electric cars still gain most against petrol and diesel. It depends on CO2 emissions:

A company replacing a 140 g/km petrol car with an electric one saves £550 at registration. After the first year, all cars registered since April 2017 pay the same £200, so the VED gap closes. Source: GOV.UK vehicle tax rate tables.

The expensive car supplement: the £50,000 rule for electric cars

The expensive car supplement is the line that weighs most on premium electric company cars.

• Amount: £440 a year, on top of the standard rate, so £640 a year in total.
• Duration: 5 years, starting from the second time the car is taxed (years 2 to 6).
• Threshold: list price over £40,000 for petrol and diesel cars, over £50,000 for electric cars from 1 April 2026. The higher threshold also applies to electric cars registered between 1 April 2025 and 31 March 2026.
• Exemption: an electric car registered before 1 April 2025 never pays it.
• List price: the published price before first registration, including options, before any discount. A £47,000 car with £4,000 of options is over the threshold.

Source: GOV.UK vehicle tax rate tables.

Example: an electric SUV with a £54,000 list price, registered in May 2026, pays £10, then £640 a year for five years, then £200. Over six years, that is about £3,210 of VED, against £1,010 for a £48,000 model under the threshold. When a fleet sets its car policy, a list price cap just under £50,000 including options saves £2,200 per car over the period.

eVED: the pay-per-mile tax on electric cars from April 2028

Announced at the Autumn Budget 2025 and confirmed after consultation in July 2026, Electric Vehicle Excise Duty will apply from 1 April 2028.

The government presents the 3p rate as about half the fuel duty paid per mile by the average petrol or diesel driver. Vans, buses, coaches and HGVs are out of scope at introduction. Primary legislation amending the Vehicle Excise and Registration Act 1994 is still to be introduced.

Sources: GOV.UK eVED policy paper (updated 28 October 2026), GOV.UK eVED consultation response.

How eVED will be paid and how your mileage is checked

eVED follows the VED cycle, managed by DVLA:

1. At each VED renewal after April 2028, the registered keeper gives an odometer reading and an estimate of the miles for the coming year.
2. DVLA calculates an estimated eVED bill, payable annually, every six months or monthly, through the same channels as VED. Drivers who expect to exceed their estimate can top up during the year.
3. At the end of the period, the actual reading is reconciled with the estimate: a balancing payment if you drove more, a credit carried forward if you drove less.
4. Checks use the odometer readings recorded at the annual MOT. Cars under three years old, which have no MOT yet, are reconciled at their first MOT. DVLA can still require a check where fraud is suspected.

The government has ruled out charging by where people drive. There is no GPS tracker to fit. Source: GOV.UK eVED consultation response.

What eVED costs per year, by mileage

At 2028/29 rates, before CPI uprating:

Note that the plug-in hybrid rate applies to every mile, whether driven on electricity or petrol. A plug-in hybrid also pays fuel duty on the petrol it burns.

Electric vs petrol: road tax and fuel duty per mile

To compare like with like, the taxes paid per mile by a petrol car must include fuel duty, today 52.95p per litre on petrol and diesel. The temporary 5p cut has been extended to 30 June 2027; from 1 July 2027 the rate returns to 57.95p and is then uprated by RPI. Source: Budget 2026 overview of tax legislation and rates.

One gallon is 4.546 litres. At 45 mpg, a petrol car pays 52.95 × 4.546 ÷ 45 = about 5.3p of duty per mile, before VAT on the duty.

From 2028, an electric car still pays less road tax per mile than a petrol car, but the gap shrinks from about £800 to about £350 a year at 15,000 miles. The real saving of an electric fleet sits elsewhere: company car tax and energy, as our electric vs petrol company car TCO shows.

Who pays road tax on a leased or company car?

The rule is simple: VED and eVED are owed by the registered keeper.

• Contract hire and leasing: the leasing company is usually the registered keeper. It pays VED and builds it into the monthly rental, including the expensive car supplement when it applies.
• eVED on leased cars: fleets and lessors will be able to submit estimated mileage that reflects the contracted mileage allowance, and to license and pay in bulk through an API or web interface. When a car leaves the fleet, the operator can make a top-up payment before sale. The government says special arrangements for leasing and rental companies are still being worked out with the industry.
• Company-owned cars: the company is the keeper and pays both taxes directly.
• Salary sacrifice cars: the lessor or the employer pays as keeper. Expect eVED to appear in new quotes from 2028, as VED does today.
• Employees' own cars (grey fleet): the employee pays VED and eVED. The tax-free mileage allowance for an employee's own car stays at 55p per mile for the first 10,000 business miles, then 25p, the same for electric and petrol cars. Source: GOV.UK travel mileage and fuel rates.

In practice, leases signed in 2026 that run beyond April 2028 will meet eVED during their term. Check how your contract handles a new tax: most hire agreements pass changes in taxation through to the customer.

Electric vans: VED and the van benefit charge

Electric vans are treated differently from cars:

• VED: light goods vehicles, including zero-emission vans, pay £360 a year (£378 by 12 monthly Direct Debits). Source: GOV.UK other vehicle tax rates.
• eVED: vans are out of scope at introduction in 2028.
• Van benefit charge: for an employee using a company van privately, the flat charge is £4,170 in 2026/27 for diesel and petrol vans, while zero-emission vans have had a nil rate since 6 April 2021. Source: GOV.UK van benefit charge 2026 to 2027.

For mixed fleets, electric vans keep a clear tax advantage on the benefit side, while VED is the same.

Timeline: road tax on electric cars from 2025 to 2030

Company car tax for electric cars follows its own path, at 4 % of list price in 2026/27. The full picture of the tax advantages is in our guide to electric company car tax benefits.

Worked example: budgeting road taxes for a 50-car electric fleet

A company runs 50 battery electric cars averaging 15,000 miles a year. Eight of them, registered in 2026, have a list price over £50,000.

eVED more than doubles the fleet's road tax bill. And the average hides the spread: a sales driver doing 30,000 miles costs £900 a year in eVED, an office-based manager doing 6,000 miles costs £180.

Three consequences for the fleet manager:

1. Budget per car, not on average: eVED is the first road tax that varies with use. A cost centre with high-mileage drivers will carry most of it.
2. Estimates must be right: an estimate based on the contract allowance that is too low triggers balancing payments; too high and cash is tied up as a credit.
3. Mileage becomes a tax figure: the miles you report to DVLA, the miles in your lease contracts and the business miles in your HMRC records should tell the same story.

How to prepare your fleet for eVED: a checklist

• List every car by keeper: owned, leased, salary sacrifice, grey fleet. Only the keeper pays.
• Measure real mileage per car over at least twelve months, not just the contract allowance.
• Compare real mileage with contracted mileage: cars well above allowance will cost excess mileage charges and eVED top-ups.
• Check list prices including options of cars ordered since April 2025 against the £50,000 threshold.
• Ask your leasing company how VED, the supplement and eVED will be shown in rentals and recharged.
• Review plug-in hybrids: they pay 1.5p on every mile plus fuel duty, and their real electric share is often low.
• Add an eVED line to the 2028/29 budget now, using real mileage, then uprate for CPI.

Our article on fleet mileage tracking explains which indicators to follow.

Real mileage per car, without fitting a box

Forecasting eVED, checking lease allowances and reconciling business miles all rest on the same data: the actual mileage of each car, month by month. Many fleets only have odometer photos, fuel card records or the contract allowance.

Voltaback's telematics without a box reads mileage, consumption and alerts directly from the car's connected services, for more than 48 brands. The company never receives drivers' geolocation, and the platform is ISO 27001 certified and UK GDPR compliant. You get mileage per vehicle and per month, ready to compare with your contracts and your DVLA estimates. To see what this saves on your fleet, try the telematics savings calculator.

Road taxes are also one of the arguments in a wider electrification plan: see our UK fleet decarbonisation guide.

Put a real number on eVED for your fleet

Road tax on electric cars has gone from zero to a mileage-based cost line in three years. The fleets that budget it well will be those that know each car's real mileage before DVLA asks for an estimate.

Book a telematics demo to see mileage per vehicle for your fleet, without hardware, and turn eVED into a forecast rather than a surprise.